RPA Sales Comparison Approach 3

Question 1

How does an appraiser reconcile multiple comparable sales into a final value indication in the sales comparison approach?

Accepted Answer

By weighing comparables based on their similarity, data reliability, and adjustment magnitude

Answer

Reconciliation involves giving more weight to the most reliable and least adjusted comparables, using professional judgment rather than simple arithmetic averaging.

Question 2

If a comparable property has a two-car garage and the subject property has no garage, what type of adjustment is made and to which property?

Accepted Answer

A negative adjustment to the comparable sale

Answer

Since the comparable is superior (has a garage the subject lacks), a negative adjustment is made to the comparable's sale price to equalize the comparison.

Question 3

Which of the following BEST describes the concept of 'market-derived adjustments'?

Accepted Answer

Adjustments derived from analyzing actual market data such as paired sales

Answer

Market-derived adjustments are supported by actual market data — such as paired sales or regression analysis — demonstrating what buyers actually pay for specific features.

Question 4

What does USPAP require regarding the number of comparable sales used in the sales comparison approach?

Accepted Answer

USPAP does not specify a minimum number; the appraiser must use sufficient data

Answer

USPAP does not mandate a specific number of comparables; it requires appraisers to use sufficient data appropriate to the assignment to develop a credible opinion.

Question 5

In the sales comparison approach, what is meant by 'location adjustment'?

Accepted Answer

An adjustment reflecting differences in neighborhood quality, traffic, views, or other locational influences

Answer

A location adjustment accounts for differences in locational characteristics such as neighborhood desirability, proximity to amenities or nuisances, views, or traffic levels that affect value.

(RPA) Real Property Appraiser Certification Practice Test

(RPA) Real Property Appraiser Certification Practice Test

RPA Sales Comparison Approach 3